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In any economic project accounting and auditing are the critical and integral components. If we cannot understand the accounting we will never understanding the auditing. In the past there was a gap between the auditors and the public it called "audit expectation gap". Expectation gap auditing has a long history and lasting. There is widespread concern the existence of expectation gap between the auditing profession and the public.
First of all, we will define of an audit is what contributes to the expectations gap. Then we will talk about the definition about the expectations gap in general. The meaning of expectations gap is the difference between what is the users of financial statements, the general public understanding and what is the exception of the audit profession in conducting the audit. In this respect, it is necessary to know the differentiation between the profession's expectations of an auditor and the auditor's perception of the audit. Except users of financial statements and the general people may be aware checker and a very different interpretation, or worse still, fails to comply with the standards set by the auditing performance.
The auditor's role embraces the detection and prevention of fraud when the users of financial statements and the general public have the educated to think, especially in relation to material items. If users of financial statements and the general public were educated to think that the auditor's role embraces the detection and prevention of fraud, especially in relation to material items. Also, the deception and error detection role of an audit might be relatively objective. However, absolute objectivity cannot be guaranteed. On another hand, there are many subjective concepts which require further clarification by Auditing Practices Board such as: materiality and material significance. When we look to the primary role of detection and prevention it is welcomed since there are at present. We cannot hold the auditor responsible for negative consequences of all his actions because there are no sufficient measures to know that. Assume that some sources of the contents of audit reports that the meaning of an audit is fixed while other sources such as academic literature sources assume that the meaning of an audit is not an objective\constant. In some latter hypothesis, there is the belief that the expectations gap can be reduced significantly- if not possible to remove.
In this assignment, these next sections will explain as the following: the definitions of Audit Expectations Gap, the important components of Audit Expectations Gap, how the Audit Expectations Gap will change or may not be changing in 2010, is it possible to eliminate the Expectations Gap, Expansion of auditor's responsibilities and enhancement of auditor independence and the role of auditing standards (ASB ethical standards) in reducing the Expectations Gap.
Definitions of the Expectations Gap:
There are many definitions of the audit expectations gap and we set out the clear definitions. Audit expectations gap is when external auditors' understanding and knowing everything about their role and duties is contrast against the expectations of the general public and user groups. According to Liggio  defined the audit expectations gap as the difference between the levels of performance expected as it is interpreted by the independent accountant and the user of financial statements.
External auditors use these definitions as their bench mark instead than the audit profession. The use of the audit profession as bench mark would help narrow the expectations gap and present a less subjective element. In this case it will be a prefer definition and provides a more stable component of the expectations gap. The same as, the audit profession's expectations are more clear-defined than the personal auditor's expectations. Reference by Liggio "users of financial statements" as opposite to members of the public in any case still will give a sequel to narrow the expectation gap while it is very much more practical to inform users of financial information - through annual general meeting, ect - than it is to help and educate the members of the people.
In 1978 Cohen Commission was regarded as both may find a gap between what the public suppose and what auditors can expect to reasonably could have done. Many definitions have failed to hint the possibility of substandard performance by the auditors [As correctly stated by Porter  ]. Although Porter highlights the importance of the audit expectations gap which can be done by comparing society's expectations of auditors against the perceived performance of auditors, the easiest comparison can be prepared during an analysis of the more objective components of the expectations gap.
The important components of the expectation gap:
There are a number of commentators have attributed the expectations gap to users' prevalent misunderstanding, ignorance, confusion, and /or lack of education. According to Porter  analyses: The total of expectations gap divided to three separate components: namely sub-standard performance (16%), deficient standards (50%) and unreasonable expectations (34%).
Figure 1: components of Audit Expectation Gap.
Due to the fact that the when the standards are missing can easily be revised, so the deficient standards component can be considered the most objective component even as sub-standard performance and unreasonable expectations are the more subjective components. While unreasonable expectations are subjective, expectation gap will still remain very important section and cannot be ignored
Also, in 1988 the Canadian Institute  of Chartered Accountants guarantors a study on the public's expectations of audit (the MacDonald Report). As the following, the commission developed some details about the audit expectation gap module that explained all the components. The components were unreasonable expectation, deficient performance and deficient standard.
In summary, the content of the gap are: Audit assurance (for example: fraud, internal control and going concern), Audit reports (perceptions of unqualified report and farther proposal for changing audit reporting), independence (provision of non management services and auditor-management relationship) and audit regular and liability.*
3. Audit expectation gap is defined as the difference that can occur between the users' expectation regarding the auditor reports and the auditor's required performance and the perception of the actual performance of the education.
There is no important trends in economy during 2010 suggest a vital change in expectation of users on performance of auditing. In my opinion, today people are more educated and have fair background in auditing. Therefore, this may be able to reduce the gap between the auditors and the general public.
There are general Reasons for existence of the Gap. First, there are so of views on the role of auditors. Second, the public dose not knows the actual work of auditors and they have difficulties to understand its content and the content of nature of auditing. Third, the public are not able to understand the audit report, because that we have the audit expectation gab. Forth, difficulties in bringing the case on audit firm.
Is it Possible to Eliminate the Expectations Gap?
Sikka et  say that the nature of the components of the expectations gap makes it difficult to remove and reduce. Perceived routine of auditors is an element which is not easy to measure and changes constantly. But it possible to reduce it substantially but not completely eliminate.
There were a number of suggestions, which were made as a means of narrowing the expectation gap. These suggestions contain an expanded audit report, which display the area to tell and explain users what auditor actually works. For example; expanded role and responsibility of auditors in the areas of fraud, wrongful acts and strengthen the independence perceived by auditors. The implementation of auditing education has been proposed as a way of lowering the expectations gap. Audit education can definitely help reduce the expectations gap. On the other hand cannot on its own be enough to solve the problem of all components of the expectations gap. According to Porter, the community should be educated and know that the duties that may reasonably expect from auditors in order for audit education to be effective.
According to Pierce and Kilcommins  study the elements of user misunderstanding gap consist of: duties, legislative and ethical framework, responsibility and audit reports. The first element duties include of fraud and error and many commentators have found the expectations gap in order to be border in terms of disclosure and the exposure of fraud. Second, the legislative and ethical framework consists of issues like: auditor appointment, audit regulation and auditor independence. In relation to auditor responsibility, Gloeck and de Jager  said that when there are a liability gap to the expectations gap since the public does not know to whom the auditor is responsible.
Auditors' opinion report helps to reduce the gap between auditors and the general public. And they try to send a massage for the public about their work.
Expansion of auditor's responsibilities and enhancement of auditor independence:
There are other ways suggested by Humphrey et al.  to close the expectation gap in 1993. They declared that the public have no good expectation to lose their hope of auditors as fraud detectives through education or pretending that all expectation are highly publicized audit failures or modifying the audit report length.
As a substitute, they proposal three suggestions: first of all, start to make an independent office for the auditing to improve auditor independence by supervision or controlling the appointment of auditors of big companies and organize audit fees. Secondly, extend the responsibilities of auditors by the law so that they include responsibilities to creditors and shareholders clearly. Third, explaining that the auditors have a responsibility to find and discover fraud. However, the size of expectation gap and benefits of these three suggested solutions need to look it carefully before suggest or apply any solution.
Also in 1993, O'Malley  consent to imposing extra responsibilities on auditors, especially with regard to detecting fraud. So, he suggested other responsibilities (four responsibilities) as the following: 1.checker assessment and management of internal control systems. 2. stated commitment. 3. Assembly audit interim financial information. 4. Mentioned by the auditors to their organization. He also confirmed that these four suggestions will raise the liability's threat unless the liability crisis is dealt with. Any expansion of the responsibilities of auditors' world not is possible as long as the liability system operates as a mechanism for transferring risk, with auditors as the prime transferees.
In 1994, Knutson  proposed a standard for the expectation gap. His analysis is that holding auditors responsible for what they should have known, is the fairest standard and it is not to be the high standard of what could have known. Moreover, the reliance of the audit report should be limited to the board of shareholders and directors and also to potential shareholders. In the same way, in 1996, Rabinowitz  recognize that there are a little of deficiencies in the audit process which cause to reduction the profession of public confidence in the profession. There are some solutions to compensate for these deficiencies. First of all, it must organize the controlling structure of the top managers and executives. Than rising external and internal audit interaction. Third, the auditors must have experience and training to the entities to be auditors. Forth, they must reviewing employment practices and developing extra effective audit actions. Finally, they have strength of audit committees.
The role of auditing standards in reducing the Expectations Gap:
In December 2004, Accounting Pored Standard (APA)  issued five standards with regard to the independence and objectivity of external auditors and the safety of the supply of insurance services. In the past these ethical standards holds the futures of ethical guidance issued. But now has added more features and generally more stringent than preceding guidance. Fore example: the Internal Financial Accounting Code (IFAC), they base on principles rather than rules and highlight objectivity from the point of view of logical and knowledgeable third party. They fulfill with ethical principles issued by the Europen Commission (EC). Separately from the five ESs, APB also issued a statement of Provision Available for Small Entities (PASE).
The individual ESs and ES-PASE are as the following:
ES1- integrity, objectively and independence.
ES2- financial, business, employment and personal.
ES3- long association with the audit engagement.
ES4- fees, remuneration and evolution policies, litigation, gifts and hospitality.
ES5- non audit services provided to audit clients.**
** From book -The Audit Process book - principles, practice and cases, 4th Editor, lain Gray Stuart Manson.
In conclusion, this assignment explains and views the proof about nature relationship of an audit expectations gap between the auditors and the general public (users). In some parts of the world there is an audit expectations gap. The users think that the auditors must provide their opinion and understand the financial statement so that they can evaluate whether to invest in the entity or not. Also, there are some users who expect auditors to do some of the audit actions at the same time as performing the attest function such as engaging in management supervision, penetrating into company affairs and distinguishing banned acts and/or fraud on the part of management. On the part of users of financial statements, these are the high expectations that make a gap between auditors and general public expectations of the audit function. The defining of audit expectation gap is differs from one person to another. In any event, all the researchers say that there are expectations gab between the auditors and the users because there are a lot of or over of expectations a function of audit's work and lack of knowledge on the role and responsibilities of the auditors made the users to expect a high level. As well, literatures disclose that when the public knows a bout the objects and the role of audit and auditors and their responsibilities will help to narrow the expectation gab.